If a product as mercurial as electric energy is to be commoditized, which means here that its momentary price is determined by supply and demand and competitive market conditions, it would be desireable to provide each consumer with a low cost, near real-time grasp of the economic impact of using electricity.
A near real-time economic impact indicator for commoditized electricity is described in U.S. Pat. No. 5,237,507. It consists of a utility central computer developing an index number ranging from 0 to 9 to represent current demand-related-price, or DRP, and a second 0 to 9 number estimating bonus/surcharge, or B-S, index that is being allotted during high demand periods to reflect the economic impact of using electricity when the power system is approaching its capacity limits. The B-S distribution, if efficiently communicated to consumers, will more aggressively influence demand during such times than would be otherwise possible. The B-S method overcomes the relative demand-price inelasticity during high demand periods by imposing large, net revenue neutral, penalties and rewards based on the marginal demand response of each consumer during out-of-doors temperature extremes and then communicating the estimated level of the reward or penalty pool in real-time.
In the preferred B-S allocation process, a surcharge pool is created that is inversely proportional to the difference between actual demand and system capacity. The bonus pool is then set equal to that surcharge pool. The number of recipients that share in the bonus pool is estimated by the extent to which demand is being constrained from normal during high demand periods. The number of bonus recipients divided into the bonus pool equals the bonus stake.
This B-S display needs to generate an estimate of the real-time surcharge pool size per KWH and the potential bonus stake/KWH. This is done by correlating past billing quantities with demand in relation to generation capacity and out-of-doors temperature. The ideal display should also provide information on individual B-S eligibility. These three parameters are compositely presented in a manner that is easily grasped by the typical consumer.
The above referenced patent describes the dual numerical display as being latched-on for specified intervals by a momentarily broadcast radio signal. The numerical display however does not provide a quick grasp to the typical consumer of his or her real time energy economics impact, nor does it provide specific guidance to each consumer for appropriate demand adjustment during high demand periods.